KLM profitability hit by rising costs
March 6, 2025
KLM has reported a sharp decline in operating profit, which fell by €234 million to €416 million in 2024, despite a 5.4% increase in revenue.
Rising costs for equipment, personnel, and airport fees put significant pressure on profitability, with the airline implementing a €450 million cost-saving plan to improve financial performance in the coming years.
Annual revenue rose to €12.7 billion, up 5% from 2023, while fourth-quarter revenue reached €3.1 billion. However, costs—excluding fuel—remained high, reducing the airline’s operating margin to just 1.6%.
KLM aims to achieve an 8% profit margin between 2026 and 2028 to fund its ambitious fleet renewal programme.
Despite challenges, cargo operations performed well, and Transavia saw revenue growth.
KLM plans to boost earnings by increasing seating capacity on some aircraft, introducing paid catering on European flights, and cutting 250 office jobs to enhance productivity and profitability.
Marjan Rintel, CEO KLM, said: “Our results for 2024 show two different sides. On one hand, we are still not operating at 100% of our flight capacity and costs continue to rise sharply.
“As a result, we run the risk of not earning enough to keep investing in our future, although I’m confident that our plans will help us to improve our operations and finances for the long term.
“At the same time, 2024 also brought some good news and progress. We saw growing customer demand for flight tickets, achieved operational improvements, welcomed the first Airbus A321neo, and successfully completed the conversion of our Premium Comfort Class – our highest-rated class.”
